Many young adults are choosing not to become parents, citing financial reasons as the primary motivation.

• A recent report indicates that approximately 25% of millennials and Gen Z without kids do not intend to have children mainly because of financial constraints.
• Over time, opinions on marriage and parenthood have evolved, but in recent years, the high cost of living has influenced individuals' choices to not have children.
• The lifestyle known as DINKs, which involves having two incomes and no children, is gaining popularity.

Raising kids is expensive.

While many believe that the rewards of having children outweigh the financial cost, others are choosing not to have children due to affordability issues.

According to a new consumer spending and saving index from MassMutual, nearly a quarter, or 23%, of millennials and Generation Z without children do not plan to become parents primarily due to financial reasons.

The lifestyle known as DINKs, which involves having two incomes and no children, is gaining popularity.

The economy is experiencing a soft landing, but more Americans are still struggling with inflation, and even high earners feel they are not yet considered rich.

Financial stressors are causing young adults to prioritize financial security over parenthood, according to Paul LaPiana, a certified financial planner and senior executive at MassMutual in Park City, Utah.

LaPiana stated that this shift signifies a greater recognition of the significance of financial stability and self-sufficiency in achieving long-term objectives that every generation must confront.

According to a survey conducted by MassMutual in July, 43% of younger generations cited a preference for financial freedom and an inability to afford children as equally important reasons.

Young adults face financial obstacles

Over the years, views on marriage and parenthood have shifted. Since the 1970s, the percentage of married adults has decreased and fewer couples are having children, as per a 2023 report from Pew Research Center. In 2022, the U.S. fertility rate hit a record low.

Recently, experts have stated that the rising cost of living is increasingly influencing individuals' decisions to not become parents.

High inflation has left many Americans feeling strained, particularly with regards to food, gas, and housing, and younger adults are disproportionately affected.

Their wages are lower than their parents' earnings when they were in their 20s and 30s, after adjusting for inflation, and they also have larger student loan balances, making it harder for them to save for long-term goals such as buying a home and starting a family.

"According to Greg McBride, chief financial analyst at Bankrate.com, the recent increase in costs has caused a lack of confidence in making significant financial decisions."

A recent survey by BadCredit.org found that over half of millennials and Gen Zers have delayed plans to have children, with 86% citing finances as the main reason.

Earlier this year, Pew found that most adults without kids reported that not having children has made it easier for them to afford things they want and succeed in their job or career.

Child-care costs are a major issue

The childcare crisis, which was already a significant issue before the pandemic, has become even more pressing due to the rise in child care costs between 1991 and 2024, which increased at nearly twice the rate of overall inflation.

Parenthood presents real financial challenges, according to Brett House, an economics professor at Columbia Business School.

The cost of child care is not only a personal financial issue but also an economic growth and productivity issue that affects all Americans, not just those with young kids, according to House.

The 2023 report by ReadyNation reveals that the U.S. loses an estimated $122 billion annually due to the infant-toddler child-care crisis.

The demands of caregiving continue to affect women's labor force participation and pay.

Studies reveal that women with young children have a lower labor force participation rate and that the demands of caregiving have contributed to the persistent gender pay gap, commonly known as the "motherhood penalty."

This issue is of utmost importance to policy makers and businesses as the U.S. presidential election approaches, according to House.